German solar group blasts government plans to tax self-consumption

Germany’s solar industry association is calling on the German government to fix its preliminary outline for a reform of the country’s Renewable Energy Act (EEG) and to eliminate a planned tax on green energy self-consumed by commercial and industrial users.

The Federal Solar Industry Association (BSW-Solar) blasted the government’s plans to reform the Renewable Energy Act, calling for a waiver of the proposed levy on owner-consumed solar power that would support the country’s energy transition.

Chancellor Angela Merkel’s cabinet on Wednesday approved an outline presented by Economy and Energy Minister Sigmar Gabriel for the government’s reform of the law. The cabinet is expected to officially sign off on the draft law in April before it goes to the Bundestag, which is expected to vote on it in June.

Gabriel’s outline would require operators of new PV systems to pay 70% of the renewable energy surcharge beginning in August. "This would mean a burden of about €0.044 per kilowatt-hour of self-consumed solar energy," BSW-Solar said. "The levy will make eco-friendly self-generation, particularly among SMEs [small and mid-sized enterprises], in agriculture and in industry largely unattractive," the organization added.

BSW-Solar is calling on the government to distance itself from the plan, warning that the country’s energy transition would otherwise suffer serious damage.

The association said it was right to spread the cost of the energy transition widely and to force industries that use fossil-fuel power plants to pay more towards the development of renewable energy as compensation for the environmental damage and health hazards they may cause. "But it is wrong and counterproductive to penalize climate-friendly solar power producers and ask them to pay for the cost of the energy transition," said BSW-Solar President Günther Häckl.

"That would be like having a gardener pay a tax on the vegetables he grew himself in order to subsidize farmers."

Self-consumers with up to 10 kWp PV capacity would be exempted from the tax but they only make up 17% of new self-consumers, according to BSW-Solar.

Häckl added that self-consumers of solar power are already contributing to the energy transition by waiving renewable energy incentive payments, helping to make the grid expansion cheaper by not using it and protecting the environment.

"It is inconceivable that solar self-consumers should now be punished for their environmental commitment," Häckl said. "The majority of the population wants the energy transition and the people even want to participate in it. Whoever weakens the environmental commitment of citizens and the middle class is wasting crucial potential for the energy transition. It seems likely that this measure is only there to protect the conventional energy industry from annoying competition."